In an interesting twist to class action equitable tolling, the Court of Appeal (Fourth Appellate District, Division One), in California Restaurant Management Systems v. The City of San Diego (June 1, 2011), examined "whether the 'equitable tolling' principles outlined in American Pipe & Construction Co. v. Utah (1974) 414 U.S. 538 (American Pipe) and Crown, Cork & Seal Co., Inc. v. Parker (1983) 462 U.S. 345 (Crown Cork) apply to extend the period within which a claim must be filed under the Government Claims Act (Gov. Code, § 810 et seq.)." Slip op., at 2. The issue arose after it was learned that San Diego had overcharged several classes of customers using the City's wastewater system. A residential customer timely filed a governmental claim seeking a refund on behalf of residential customers who were overcharged and, after the claim was denied, filed a proposed class action lawsuit on behalf of that class of customers. After that action was settled and dismissed, California Restaurant Management Systems (CRMS) filed its own governmental claim and then filed a putative class action on behalf of restaurant owners. The City moved for summary judgment, contending CRMS's governmental claim was not timely filed, mandating dismissal of CRMS's proposed class action lawsuit. CRMS opposed the summary judgment motion, arguing the pendency of the first action tolled all limitations periods, including the period for filing a governmental claim. The trial court disagreed, and entered judgment in favor of City.

While the Court supplied an extensive background discussion of Government Claims Act requirements and equitable tolling, the ultimate basis for its decision was simply stated: "We conclude a prior class action does not equitably toll or satisfy the governmental claims requirement for claimants not within the class description contained in a timely-filed governmental claim on which the prior class action was predicated." Slip op., at 18. The first action described the claiming class as "residential" customers. This eliminated the possibility that commercial customers could claim to have placed the City on notice of their claims. The Court declined to extend the class claim filing exception recognized in City of San Jose v. Superior Court, 12 Cal. 3d 447 (1974).

The Complex Litigator

The Complex Litigator reports on developments in related areas of class action and complex litigation. It is a resource for legal professionals to use as a tool for examining different viewpoints related to changing legal precedent. H. Scott Leviant is the editor-in-chief and primary author of The Complex Litigator.